DAT Solutions: Demand dips, but rates hit three-year highs

Special to Land Line | Wednesday, December 13, 2017

Demand for trucks is way up as we head deeper into December. However, load posts on DAT MembersEdge experienced a holiday hangover during the week ending Dec. 9, falling 10 percent while the number of available trucks rose 12 percent.

Load-to-truck ratios slipped as a result.

Van: 7.2 available loads per truck, down from 9.3

Refrigerated: 9.8 loads per truck, falling from a multi-year high

Flatbed: 27.9 loads per truck

Well-timed vacation: With the ELD mandate starting Dec. 18, some drivers are planning to go on vacation for the rest of the year. It'll be interesting to see how tighter capacity affects rates as shippers look for trucks to meet demand for the holidays and end-of-year freight targets.

Van rates settle: Van rates started to settle a bit last week, with prices falling on 59 of the top 100 van lanes, despite the uptick in the national average rate. Spot van volumes declined 14 percent and truck posts increased 12 percent. Western markets remain solid with the average outbound rate from Los Angeles up 4 cents to $2.74/mile. Memphis, another key market for retail goods, added 3 cents to $2.40/mile.

Flatbeds up: Spot prices for flatbed freight remain high for this time of year. The national average flatbed rate increased 1 cent to $2.31/mile, just 3 cents lower than the peak in October when hurricane-relief supplies were rushing into the Southeast.

Tri-haul of the weekRetail shipments are driving demand on lanes heading into the Northeast but the flip side of that is falling rates coming out of the Northeast. You might want to look at a tri-haul route that lets you earn head-haul rates for the entire trip.

Take Columbus-Philadelphia, for example. Pre-Christmas demand pushed the average rate to $3.50/mile but the return trip is down to $1.21/mile. If you can do it in two days, you make $2,200, which is not bad.

But you can make good money by turning this roundtrip into a tri-haul (actually, more of a straight line with an extra pick and drop). Instead of going straight back to Columbus, take a load from Philly to Pittsburgh, which paid an average of $2.61/mile last week. From there it’s less than 200 miles back to Columbus, and that lane paid $3.09/mile.

This tri-haul could add about 20 loaded miles, depending where you pick up and drop off, but for that little bit extra, your average rate per loaded mile goes up from $2.36 to $3.14/mile. You make about $800 more than you would on the straight roundtrip – for a total of more than $3,000 on the 960 miles.

Rates are derived from DAT RateView, which provides real-time reports on prevailing spot market and contract rates, as well as historical rate and capacity trends. All reported rates include fuel surcharges.